Huge protests as Greek Parliament votes for austerity

In spite of a 48-hour general strike that shut down much of the Greek economy, and demonstrations involving hundreds of thousands of angry workers and youth, the Greek Parliament early Monday morning approved austerity measures demanded by European bankers and financiers as a condition for extending credit to the country.

By a vote of 199 to 74, with 27 members abstaining or not voting, the 300-member Parliament gave the government authority to keep on negotiating with the “troika” consisting of the European Union, the European Central Bank and the International Monetary Fund to finalize a new loan of $170 billion. It will allow Greece to pay an installment on its huge international debt (160 percent of its annual gross domestic product) and perhaps get further financing. If the government cannot come up with a $19 billion payment on existing debts by March 20, Greece will be in default, with possibly dire consequences for the whole Euro currency area and European Union, and beyond. The loan is coming from the “troika” because Greece can not get any private credit. Another loan was provided in 2010, which did not solve the problem.

The austerity measure approved Monday morning calls for layoffs of 150,000 government employees in this country of 11 million, 15,000 of them this year. Many government programs will be cut back, eliminated or privatized. The minimum wage will be cut by 22 percent (from about $1,100 per month to $880). The cuts in the minimum wage are supposed to make Greek labor “competitive” with that of countries of Eastern Europe where the minimum wage is a fraction of this, but many Greeks have already been working for subminimum wages, or can only find part time or contingent work.

The government, headed by caretaker Prime Minister Lucas Papademos, consisted prior to the vote of a coalition of the social democratic PASOK (Pan Hellenic Socialist Movement), the conservative New Democrats and the ultra right LAOS (Popular Orthodox Rally). The representatives of the Communist Party (KKE), the Coalition of the Radical Left (SYRIZA) and others voted against the austerity measures. But so did LAOS, which quit the coalition. In addition, 43 of the PASOK and New Democracy deputies voted against the measures, while 27 others abstained or did not vote. Both PASOK and New Democracy immediately expelled these individuals from their parties (22 from PASOK and 21 from New Democracy). Earlier, six cabinet members had quit the government in opposition to the austerity measures.

The KKE and its affiliated trade union federation, PAME, organized a separate demonstration of tens of thousands of workers. It called for Greece to repudiate its international debt and pull out of the European Union, as well as for new elections.

Some of the street demonstrations in Athens and elsewhere spiraled into violence, with dozens of buildings in the capital set on fire on Sunday night. Demonstrators threw rocks and firebombs at police, who responded with tear gas. The KKE denounced the violence, which it attributed to the actions of provocateurs.

Mikis Theodorakis (composer of the music for the movie “Zorba the Greek”), 86, and Manolis Glezos, who because a legend when he tore down a Nazi flag that was flying over the Acropolis during the German occupation of Greece in World War II, were stopped from speaking by the tear gas.

Germen Chancellor Angela Merkel is deeply resented as being one of the chief instigators of the hard line taken by the “troika’ in forcing Greece to take additional austerity measures, and of the idea of putting most of the loan in escrow so that it can only be used to pay past debts. Greeks remember their country’s experience during the German occupation, when thousands died of starvation because of the economic demands that Germany imposed.

The Greek government announced that there will be parliamentary elections in April. It is widely expected that the electorate will punish those who voted for the austerity measures, especially PASOK, as polls show that 48 percent of Greeks were against the approval vote, while only 38 percent were in favor.

And all this may be in vain. Many commentators point out that a default may be inevitable. Indeed, by shrinking the economy even more, taking money out of the hands of consumers, the austerity program will make it even harder for Greece to collect the revenues needed to recover. Industrial output is already in sharp decline since previous austerity measures were approved in 2010, and the economy shrank 7 percent in 2011. Unemployment is 21 percent. Government services will be sharply cut or privatized, and taxes on everybody will go up. Even though foreign holders of Greek debt are being asked to accept “haircuts,” or discounts of up to 70 percent, most Greeks feel that the country is being pushed to the wall.

There is no certainty that the arrangement will finally be approved by the troika, or by enough creditors to make it work. Germany and other wealthy countries had demanded that leaders of Greek political parties swear that they are not going to try to renegotiate it so as to gain advantage with the voters in the lead-up to the elections. At writing, PASOK leader George Papandreou and New Democracy leader Antonis Samaras had signed letters promising to do so, and the government had cut the budget by another $425 million, yet there is talk that some wealthy country governments would prefer to push Greece out of the Euro zone.

On Monday, February 21, however Euro zone finance ministers approved the package, which is supposed to cut Greece’s debt to 120.5 percent of gross domestic product by 2020, increasing chances that the IMF will approve it. But the parliaments of Germany, the Netherlands and Finland, the countries most critical of Greece, must now approve the deal.

CONTRIBUTOR

Emile Schepers is a veteran civil and immigrant rights activist. Emile Schepers was born in South Africa and has a doctorate in cultural anthropology from Northwestern University. He has worked as a researcher and activist in urban, working-class communities in Chicago since 1966. He is active in the struggle for immigrant rights, in solidarity with the Cuban Revolution and a number of other issues. He now writes from Northern Virginia.